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Www Mortagesmortgagebank Tv An Appreciation David L Wolper Transformed Tv Landscape Los Angeles Times 2 Mortgages Mortgage Bank 主旨演讲：金立群（Keynote Speech：Jin Liqun）

Www Mortagesmortgagebank Tv An Appreciation David L Wolper Transformed Tv Landscape Los Angeles Times 2 Mortgages Mortgage Bank

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　　 Let me tell you the debate on the board of the World Bank. The Chinese executive director said she did not believe in uncoupling or decoupling. Her view was echoed could only by the next Mexican chair. The rest of the world top-notch economists all said decoupling or uncoupling is the trend. I'm the third-class economist, and fortunately I was right this time.

　　 Now, the euphoria that Asian economies would continue to do fine was a theme song which we heard about one or two years ago. Some multinational, multi-development institutions have revised downward Asia's growth three times last year, and that says a lot. This certainly illustrates the inherent difficulty of economic forecast in a volatile period. This also dictates the prompt actions required to address the challenges of the roller coaster nature.

　　 China's calendar of 2008 recorded dramatic shift in focus of the macroeconomic policies in 2008. The January of 2008 ushered in the policy of controlling inflation and overheating, which gave way to the policy of maintaining growth and containing inflation by June, which in turn was overwritten by the new initiative of proactive fiscal policy in a properly expansionally monetary policy in November.

　　 And finally we have the stimulus package was four trillion Chinese yuan. Nevertheless, the stimulus package is timely and is being implemented with close attention to the quality of investment. The social programs, environmental protection, the reform efforts feature prominently in the stimulus package. I personally believe that an 80 percent or even higher growth rate is achievable.

　　 Properly fast economic fast economic growth in China is not just good for China itself but also important for the rest of the world. At this moment, China is faced with challenges, perhaps of a different kind. It is always much less of a problem to spend more of your own money than to borrow more when you're already deeply indebted, but for China the crucial matter is to improve the purchasing power of the rural people -- 750 million strong and with 200 million migrant workers. That is probably the key.

　　 I have followed very closely the economic stabilization program of the U.S. administration. The extraordinary measures taken by the U.S. government are entirely necessary. I think that the general public in this country is appreciative of the need for government intervention. It is expected that some people will criticize the specifics of the rescue program or the sequence of actions taken to contain the crisis. The fact is -- I'm not defending the U.S. government -- the fact is that the sheer force and the contagious nature of a major crisis will not give any decision makers the luxury of a well-thought-out master plan detailing each and every step of the rescue efforts that could respond to the multifaceted dimensions of the crisis efficiently and effectively. Under tough times, the role played actively by the U.S. government is crucial in restoring market confidence. And the Chinese premier put it, I think in New York, "Confidence is more valuable than gold," g-o-l-d.

　　 There shouldn't be any doubt about the resilience of the U.S. economy. It's broadly believed that transfer of power will be smooth. The American people will work together under the Obama administration to tackle this issue, this crisis. Although U.S. is faced with daunting challenges on many dimensions, its economy remains the largest with ample wiggle room for maneuver. With effective implementation of economic stabilization program, the U.S. economy will recover and be on the right track again once again. Good luck to you.

　　 This crisis should (inaudible) argument for a laissez-affaire capitalism. But it doesn't mean the demise of market economy. Market economy is most efficient in resources allocation. Market economy has fundamental principles which are sound. What is important is improvement in a regulatory system. The crisis speaks volumes for the horrendous costs of a market failure. It is now all the more convincing that the market is not perfect and that allowing the market to go free-wheeling is a recipe for disaster. The government must see to it that market failures are identified as soon as they occur and be addressed without delay. No regress, monitoring, and regulatory system can substitute for good governance at the corporate level. As Chairman of the Supervisory Board, I'm working towards further improving the governance framework and the risk management structure in China investment cooperation.

　　 The current crisis offers us most valuable lessons, both positive and negative, about management of a company. Behind the debris of collapse deference, I could see the destructive factors that work in most competitive companies to ruins. Too often we see a talented and experienced manager build up a company all the way to celestial status and then become so cocksure that he will follow nobody's advice but his own basic instinct only to see his empire unravel in his own hands. The destructive force is a letasemoir mentality. The failure is due to absence of sound governance, corporate governance. As I see it, it behooves the supervisor board of CIC to up the ante in enforcing sound governance in our company.

　　 The government of China and the United States have stayed in close touch during the current crisis. The leaders talk frequently on the phone. At the invitation of President Bush, President Hu Jintao attended the G 20 summit in Washington, D.C., at the end of last year. In December, the 5th and 6th U.S. China Strategic Economic Dialogs -- SED -- were held in Beijing and Washington, D.C., respectively. The Chinese government has reiterated its willingness to cooperate with the United States on many occasions.

　　 Finally, a couple words about CIC. We are open, and we take the United States as one of the best partners. Thank you very much.

　　 MR. SHEN: Thanks for your excellent speech. I think from your speech I can have a few messages from that. One is that Mr. Jin is confident about the Chinese government to manage the macro economy while it stays open, so China will continue to reform in order to deal with the challenges due to global slowdown.

　　 And, secondly, Mr. Jin also emphasized that decoupling is yet to come. If emerging markets are having Plan B or Plan C, then they may be able to deal with prices better, but not yet. I mean, we are still waiting for more thoughtful plans to really deal with the crisis at the moment.

　　 Lastly, Mr. Jin is also confident about the Chinese economy. The Chinese economy can grow above 8 percent probably this year. The number we just had from last year was around 6.5 percent -- almost is the lowest in the past two decades -- but probably the economy could recover second half of this year partly because of the government rescue plan.

　　 Mr. Jin, I will ask the first question, then I'll open the floor to the audience. I think you mentioned that, you know, as the Premier Wen Jiabao said, the confidence is more valuable than gold. But I also believe that confidence comes from some structure, the policies, right. We needed to see physical directions of policies that can lead us to more a more confident world. But, you know, from the policies that we have received from the United States or from China's side, most of the current policies are addressed and they're needed to (inaudible) to anti-cyclical movement, but I think many of them failed to address the needed -- for structure changes. Or some people may criticize that. The governments is stabilizing the economy at the cost of future large adjustment, right, so how can we reconcile just two different aspects and -- so that we can gain more confidence about government policies?

　　 MR. JIN: You know, my name in Chinese means gold, g-o-l-d. I'm very happy to see prices going up all these years, and I was very much depressed when the gold prices went down.

　　 Confidence means you are -- you can do something which would be good for yourself, for the community, and for the economy as a whole, but most important I think confidence can help you to do something countercyclical rather than procyclical. But your question is whether any government can put in place a policy which can solve all of the problems -- current problems, future problems -- at one go. The answer is no.

　　 For instance, at this moment I think the Obama administration is faced with a tough issue of dealing with the excessive consumption, okay, serial saving or (inaudible) saving on the one hand, which I think is a big problem; and on the other hand Americans will have to save now to save your economy. Are you going to solve the problem now or the problems which will be five or six years later? I don't think it's possible. For Americans to shift to a different kind of life it takes time. Just like a doctor when you have a patient. You want to cure the patient with kind of a strong dosage which would kill the patient right away. So, don't do that. Don't do this kind of thing which is procyclical.

　　 For the Chinese, as I said, to spend more money is fine for the economy, but why are the Chinese people reluctant to spend? Because of the reform. I'm sorry to say that. Because reform would require that they should take care of themselves more than put themselves under the wings of the government forever. They have to save more for the education of their children, save more for medical purpose, save more for their life after retirement. And this is, again, procyclical. So that, again, takes time.

　　 So, don't worry. Don't expect any policy to solve all of the problems at one go.

　　 Thank you.

　　 MR. SHEN: Okay. Right. Let's have three more questions depending on the time we have.

　　 Yes, please.

　　 SPEAKER: (Inaudible) Carnegie Endowment. Very interesting and helpful talk, Mr. Jin. I wonder -- you've just mentioned the Americans need to save more and yet as we face a global crisis, and one that is going to impact the developing countries particularly seriously, there's also a need for somebody to buy on the global markets if poor countries are going to be able to sell their way or trade their way out of low income rather than rely on foreign aid. How do you see the overall macro situation globally evolving ideally? You mention the United States needs to save dramatically but then that might push us into a kind of trade surplus environment which might be difficult for the developing world.

　　 MR. JIN: I think it's very easy to answer your question. China and other developing countries will have to continue to sell to the United States so your consumers would benefit. You can sell more goods of high-end products, high-technology goods to China without any problem for your national security. Thank you.

　　 MR. SHEN: Yes, please.

　　 SPEAKER: I'm (inaudible) from J.P. Morgan. Mr. Jin, thank you very much for your speech. Just one question. You mentioned that there is excess capacity in the (inaudible) sectors and how long you think it's going to take to take the excess capacity out. And also the (inaudible) -- the stimulus package -- is that really adding excess capacity into all these sectors? Thank you.

　　 MR. JIN: Thank you very much. I was comparing the excess capacity buildup in the financial sector versus a case of excess capacity in a particular sector. I'm not talking -- I was not talking particularly about China in a (inaudible) just (inaudible) analogy.

　　 In China you cannot say categorically that we have excess capacity in all of the sectors, which is certainly not true. Now, take one case -- the housing market. You can say we have a housing market glut in the coastal areas. But I would say we have so many people crying out for decent housing in the hinterland part of China, so you cannot say, you know, housing market, you know, is really -- real estate market is all we're needing.

　　 And also in terms of infrastructure, I think basically along the coastline we have built up a very high quality infrastructure -- roads, you know, railways, telecommunication -- but if you look at the hinterland provinces, I think there's a deplorable deficiency of infrastructure. So, the issue is to rebalance the Chinese economy not just in terms of external sectors but also domestic, you know, economy. Thank you.

　　 MR. SHEN: Yes, please.

　　 MR. FELDMAN: Thank you. Harvey Feldman, Heritage Foundation.